Rose Petroleum - Capital Network: An Encouraging Update

Rose Petroleum plc (LON:ROSE) provided an update on the likely completion date for the 3D seismic survey they are in the process of acquiring in the Paradox Basin, following the successful completion of a £3M funding. The 3D seismic data will be key to identify drill targets in the Cane Creek interval and other potential clastic reservoirs of the Paradox Formation, but also to steer the horizontal leg of the wells within the natural fracture system for optimal drilling and completion. Data acquisition started on 4/10/17 and should take up to five weeks; management expects to be in a position to select drilling targets by the end of the first quarter 2018. We have updated our project timeline accordingly, and believe the Company is well on track and has also indicated it may well advance this timeline. Management also identified a source of potential in the Leadville Limestone formation, additional to the resources estimated by Ryder Scott in 2014, in which the 3D seismic could identify potential structures.

Given the expected time to complete the acquisition of the 3D data, as well as go through the processing and interpretation phases, management expects to be in a position to select drilling targets by the end of the first quarter 2018 latest and this is likely to be accelerated.

Green Dragon Gas (GDG.LON) published FY16 results on April 27th. We are encouraged by the 5.6% production increase y-o-y, which although 8% lower than our expectation, demonstrates the positive impact of the improved compression at the wellhead in the GSS block. We believe that the drilling of 147 new wells in GCZ, following the recent approval of the ODP by the Chinese authorities, will participate in a turnaround in production performance. We are also pleased by the lower operating costs achieved compared to our forecasts. However, these results are negatively impacted by a very poor performance of the retail business. We view the imminent disposal of the retail operation as positive, as it will bring cash proceeds, eliminate a source of significant losses and provide more transparency into the CBM. We are encouraged by the focus on strengthening the balance sheet by refinancing the debt, selling non-core assets.

SDX Energy (SDX.LON) is an oil and gas exploration and production company with assets in Morocco and Egypt. Born out of the merger between Canadian companies Sea Dragon Energy and Madison PetroGas in late 2015, SDX Energy (SDX.LON) was listed on the AIM market in London in May 2016. A solid production base, positive free-cash flow generation and debt-free balance sheet, provide a strong valuation support and put the company in a privileged position to carry out accretive acquisitions of distressed Egyptian assets, such as that of Circle Oil in early 2017. An attractive exploration portfolio provides additional high impact value optionality. The SD-1X exploration well in South Disouq already discovered gas in the shallower Abu Madi objective and is expected to reach a potentially oil-bearing deeper objective imminently. We reckon that only part of our estimated current value of South Disouq is priced in the current share price, leaving at least 35p (+57%) of potential risked upside.

Mytrah Energy is an alternative energy company, building and operating a portfolio of wind farms in locations across India, with agreements in place to expand into solar, also in India.

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Rose Petroleum is a London-listed (AIM Ticker: ROSE) Oil and Gas Exploration and Production company primarily focused on unconventional resource plays in the United States. Rose consists of two divisions: Oil & Gas and Mining.

Rose Petroleum is a London-listed (AIM Ticker: ROSE) Oil and Gas Exploration and Production company primarily focused on unconventional resource plays in the United States. Rose consists of two divisions: Oil & Gas and Mining.

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